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The following article was posted on February 5th, 2014, in the New Times - Volume 28, Issue 28 [ Submit a Story ]

The following articles were printed from New Times [newtimesslo.com] - Volume 28, Issue 28

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Did Morro Bay City Councilman George Leage receive public money to cater a dinner?

By COLIN RIGLEY

Does Morro Bay City Councilman George Leage think he did anything wrong? Absolutely not, and he doesn’t know why anyone would make such a big deal about it.

“I was really helping out,” Leage told New Times. “And I get crushed.”

By helping out, Leage was referring to the loss he said he took for catering the Morro Bay 50th Birthday celebration kickoff dinner on Jan. 11. And by crushed, he was referring to criticism he received because he catered that dinner.

In fact, Leage not only catered the event, but he sat on the committee—as one of two City Council liaisons—that organized the event. More so, he was one of four city votes that awarded $15,000 to the committee just in time for the event, and that was just a fraction of the amount that he and fellow City Council liaison Nancy Johnson said was needed.

On Nov. 12, the Morro Bay City Council voted 4-1 to contribute $15,000 to the city’s 50th Anniversary Celebration Committee. Councilman Noah Smukler was the sole dissenting vote, arguing that the request was too great and too nebulous—he suggested awarding $5,000 to the committee.

Originally, Leage and Councilwoman Nancy Johnson asked for $50,000—more than three times what they ultimately received. Both fought vehemently for a greater contribution, claiming that they needed “seed money” in order to fund upcoming events, particularly the first two: a Jan. 1 hike in conjunction with California’s State Parks 150th Anniversary Celebration, and the kickoff dinner.

“We gotta realize this is a once-in-a-lifetime thing, and I think this event, it’s a community thing,” Leage said at that meeting. “But you are still going to attract a lot of people from out of town, and it is going to put a little money in the coffers. It’s going to take at least $50,000 to get this going, there’s not doubt about it. I’ll just leave it at that. We gotta do this. I mean, come one, once in a lifetime.”

Yet Leage didn’t mention that he had already been approached to cater the event. Leage and his two sons own the Great American Fish Company, and he manages Off the Hook, which is owned by his sister, he said. So on Jan. 11, both of those restaurants shelled out prime rib, lobster, and duck to about 200 guests who each paid $50 to attend.

“He volunteered because he’s on the committee and he sat in on all the meetings,” Nancy Johnson told New Times.

No other local restaurant owners were asked to provide food for the event, Leage said.

“It had nothing to do with being a city councilman,” he said. “It had something to do with me doing a darn good job.”

But Kathay Feng, executive director of California Common Cause, said the situation sounds like a textbook conflict-of-interest case, and Leage should have recused himself from the vote.

“This is a no-brainer,” she said. “There are some things that are gray areas; this is not one of them.”

Interim City Attorney Anne Russell said she was unaware until after the event that Leage had been hired to cater, and she declined to speculate as to whether he should have been recused from the vote. As of the Nov. 12 City Council meeting, Russell had been on the job for a little more than a week.

Still, some of the largest questions hang on what the funding was intended for, how much was slated for the dinner, and how much was ultimately spent.

On Nov. 12, Nancy Johnson argued that the committee would need no less than $36,000 to cover the costs of the first two events.

“That’s where we are going to have up-front expenses to get that started,” she said at the meeting. “… We have a wonderful local restaurant that’s going to provide us some great food for our food service. Mr. Leage, thank you.”

Leage told councilmembers that he’d like to see a contribution of at least $25,000.

Though both Leage and Nancy Johnson threw out such figures, they didn’t specify how much money was necessary for each event. Asked about those costs, and how much of the $15,000 contribution was actually spent, Nancy Johnson deferred to Joan Solu, who’s been spearheading many of the 50th birthday events.

According to Solu, none of the $15,000 went toward the dinner and, in fact, none of it had been spent on anything as of press time.

“George [Leage] was paid really, really, really minimally,” she said. “We wanted to make the event self-sustaining from the very beginning, and I think we did a good job of that.”

However, an exact accounting of those funds is still pending.

At the City Council’s Dec. 10 meeting, Smukler asked that the committee provide a review of its city funding. Only Mayor Jamie Irons and Councilwoman Christine Johnson threw their weight behind the request, and Leage and Nancy Johnson weren’t recorded as supporting the measure in the official minutes. In an audio recording of the meeting, Nancy Johnson can be heard begrudgingly telling Smukler, “You’ve got three; go for it.”

Leage contends that there was no wrongdoing, indeed no smoking gun, because he took a financial loss, even if he was compensated for providing food at the rate of $15 per plate. Overall, Leage called it a “tremendous loss,” but declined to detail exactly how much money he lost out of pocket. When pressed on the matter, Leage would only say that he would have needed to charge $30 to $35 per plate to make the night financially viable.

How much did he pay out of pocket?

“Why should I give out that information?” Leage told New Times.

When asked to divulge his total losses, Leage said, “I don’t want to look like a good guy here, and that’s what it’s going to look like.” He added that he would never again provide his services for such an event because of backlash he received.

Leage reiterated several times that he felt there was no wrongdoing because he took a loss, and he provided a good meal—a meal that was tantalizing enough to sell an additional 100 tickets once residents learned his restaurants would be providing the food, he added.

Asked if he would be skeptical if he learned a public official had argued to fund an event he was also catering, Leage scoffed: “I wouldn’t see anything wrong with it as long as the guy did a good job.”

Nor did he consider recusing himself from the Nov. 12 vote.

“Didn’t think about it,” he said. “Because the people said, ‘George, we want you to do it, because you do a good job.’”

Carla Wixom, a former city councilwoman and a mayoral candidate in the 2012 election, came to Leage’s defense at the Jan. 14 City Council meeting.

“There won’t be that many expenses because George [Leage] donated most of everything that he did, with the minimal amount that he’ll be reimbursed for food costs,” she said. “And I donated everything I did, and Nancy [Johnson] and many others in the community donated everything they did—just to clear that record—as some people have thought we were lining our pockets. Far from the truth.”

A full accounting of the funding is scheduled to come back to the city at a later date.